NEW YORK, July 27, 2020 (GLOBE NEWSWIRE) -- Faruqi & Faruqi, LLP, a leading national securities law firm, reminds investors in Wins Finance Holdings, Inc. (“Wins” or the “Company”) (NASDAQ:WINS) of the September 23, 2020 deadline to seek the role of lead plaintiff in a federal securities class action that has been filed against the Company.
If you invested in Wins stock or options between October 31, 2018 and July 6, 2020 and would like to discuss your legal rights, click here:www.faruqilaw.com/WINS. There is no cost or obligation to you.
You can also contact us by calling Richard Gonnello toll free at 877-247-4292 or at 212-983-9330 or by sending an e-mail torgonnello@faruqilaw.com.
CONTACT:
FARUQI & FARUQI, LLP
685 Third Avenue, 26th Floor
New York, NY 10017
Attn: Richard Gonnello, Esq.
rgonnello@faruqilaw.com
Telephone: (877) 247-4292 or (212) 983-9330
The lawsuit has been filed in the U.S. District Court for the Central District of California on behalf of all those who purchased Wins securities between October 31, 2018 and July 6, 2020 (the “Class Period”). The case, Kamau v. Wins Finance Holdings Inc. et al., No. 2:20-cv-06656 was filed on July 24, 2020.
The lawsuit focuses on whether the Company and its executives violated federal securities laws by making false and/or misleading statements and/or failing to disclose that: (1) the ultimate repayment of a RMB 580 million loan to Guohong Asset Management Co., Ltd. (“Guohong Loan”) was highly uncertain; (2) nonpayment of the Guohong Loan would have a significant impact on the Company’s financial and operating condition; (3) weaknesses in Wins’s internal control over its financial reporting persisted despite the Company’s repeated assurances to investors that it was taking steps to remediate these weaknesses; (4) the foregoing issues, among others, made the resignation of Wins’s independent auditor foreseeably likely; and (5) as a result, the Company’s public statements were materially false and misleading at all relevant times.
First, on October 31, 2019, Wins filed a notification of inability to timely file Form 20-F on Form NT 20-F with the SEC.
On this news, the Company's stock price fell from $11.90 per share on October 31, 2019 to $11.20 per share on November 1, 2019: a $0.70 or 5.88% drop.
Then, on May 26, 2020, Wins issued a press release announcing that the Company received a delisting determination letter from Nasdaq. The press release stated, in relevant part, “[a]s disclosed previously, the Company is working assiduously to complete its delinquent filing with SEC and to regain compliance with the Nasdaq listing rule as soon as possible.”
On this news, the Company's stock price fell from $7.81 per share on May 26, 2020 to $7.20 per share on May 27, 2020: a $0.61 or 7.71% drop.
The Company’s undisclosed ongoing financial difficulties—including nonrepayment of the Guohong Loan—and material control weaknesses came to a head on June 30, 2020, when CZD resigned as the Company’s independent auditor after less than three years in that role. On July 6, 2020, Wins issued a press release announcing CZD’s resignation in which it stated, in relevant part:
CZD expressed an adverse opinion on the Company’s internal control over financial reporting as of June 30, 2017 and 2018 because of material weaknesses. During the Company’s years ended June 30, 2017 and 2018 and through June 30, 2020, except with respect to the material weaknesses described below, there were no “reportable events” (defined below) requiring disclosure pursuant to Item 16F(a)(1)(iv) of Form 20-F. As used herein, the term “reportable event” means any of the items listed in paragraphs (a)(1)(v)(A)- (D) of Item 16F of Form 20-F. The following material weaknesses have been identified and included in management’s assessment: lack of sufficient accounting personnel qualified in US GAAP, and SEC reporting; and insufficient accounting staff, which results in a failure to segregate duties sufficiently to ensure a timely and proper preparation and review of the financial statements.
On this news, the Company's stock price fell from $33.76 per share on July 6, 2020 to $31.70 per share on July 7, 2020: a $2.26 or 6.10% drop.
The court-appointed lead plaintiff is the investor with the largest financial interest in the relief sought by the class who is adequate and typical of class members who directs and oversees the litigation on behalf of the putative class. Any member of the putative class may move the Court to serve as lead plaintiff through counsel of their choice, or may choose to do nothing and remain an absent class member. Your ability to share in any recovery is not affected by the decision to serve as a lead plaintiff or not.
Faruqi & Faruqi, LLP also encourages anyone with information regarding Wins’s conduct to contact the firm, including whistleblowers, former employees, shareholders and others.
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